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Flybe issues profit warning

Aircraft with the new white and purple Flybe livery

Although regional carrier Flybe has reported “good revenue performance” in the first half of the year, it warns that a “softening” in the second half could lead to lower profits than expected.

The airline has been in the process of reducing its capacity on less popular routes, which it says has delivered higher load factors (up 8 percentage points to 84 per cent) and revenue per seat (up 8 per cent).

While Flybe says its costs have increased due to a rise in fuel and carbon prices and the lower value of the pound, it estimates that its pre-tax profit for the first half of the year will be similar to the previous year (£9.4 million).

However, the carrier’s board believes weakening demand for “near-continent markets” will continue into the second half and will combine with higher fuel prices to impact profit performance.

The new estimated adjusted loss before tax for the full year will be £12 million – still a decrease compared to the £19.2 million lost in 2017/18.

Christine Ourmieres-Widener, CEO of Flybe, commented: “We have made progress in driving our unit revenues across the summer season, but we are now seeing a softening in the market. We are reviewing further capacity and cost-saving measures while continuing to focus on delivering our Sustainable Business Improvement Plan. Stronger cost discipline is starting to have a positive impact across the business, but we aim to do more in the coming months, particularly against the headwinds of currency and fuel costs. We continue to strengthen the underlying business and remain confident that our strategy will improve performance.”

Flybe is due to release its interim results on 14 November.

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